EX-12.1 2 sug123112ex121.htm EXHIBIT SUG 12.31.12 Ex 12.1


Exhibit 12.1
Southern Union Company
Computation of Ratio of Earnings to Fixed Charges
(in millions, except for ratio amounts)
(Unaudited)

The following table sets forth the ratio of earnings to fixed charges for Southern Union on a historical basis for the period from March 26, 2012 to December 31, 2012, the period from January 1, 2012 to March 25, 2012, and the years ended December 31, 2011, 2010, 2009 and 2008. For the purpose of calculating such ratios, “earnings” consist of pre-tax income from continuing operations before income or loss from equity investees, adjusted to reflect distributed income from equity investments, and fixed charges, less capitalized interest. “Fixed charges” consist of interest costs, amortization of debt discount, premiums and issuance costs and an estimate of interest implicit in rentals. No adjustment has been made to earnings for the amortization of capital interest for the periods presented as such amount is immaterial. Interest on FIN 48 liabilities is excluded from the computation of fixed charges as it is recorded by Southern Union in income tax expense versus interest expense.

 
Successor
 
 
Predecessor
 
Period from Acquisition (March 26, 2012) to December 31, 2012
 
 
Period from January 1, 2012 to March 25, 2012
 
Years Ended December 31,
 
 
 
 
2011
 
2010
 
2009
 
2008
Fixed Charges:
 
 
 
 
 
 
 
 
 
 
 
 
Interest expense, net
$
130

 
 
$
50

 
$
217

 
$
210

 
$
191

 
$
204

Net amortization of debt discount, premium and issuance expense
(24
)
 
 
2

 
6

 
7

 
6

 
3

Capitalized interest
1

 
 

 
1

 
7

 
26

 
19

Interest charges included in rental expense
5

 
 
2

 
7

 
6

 
6

 
5

Total fixed charges
112

 
 
54

 
231

 
230

 
229

 
231

Earnings:
 
 
 
 
 
 
 
 
 
 
 
 
Consolidated pre-tax income from continuing operations
50

 
 
45

 
294

 
278

 
177

 
332

Less: earnings (losses) from unconsolidated investments
(7
)
 
 
16

 
99

 
105

 
81

 
75

Total earnings
57

 
 
29

 
195

 
173

 
96

 
257

Add:
 
 
 
 
 
 
 
 
 
 
 
 
Fixed charges
112

 
 
54

 
231

 
230

 
229

 
231

Distributed income of equity investees
(6
)
 
 

 
3

 
4

 

 
77

Less:
 
 
 
 
 
 
 
 
 
 
 
 
Interest capitalized
(1
)
 
 

 
(1
)
 
(7
)
 
(26
)
 
(19
)
Income available for fixed charges
$
162

 
 
$
83

 
$
428

 
$
400

 
$
299

 
$
546

 
 
 
 
 
 
 
 
 
 
 
 
 
Ratio of earnings to fixed charges
1.45

 
 
1.54

 
1.85

 
1.74

 
1.31

 
2.36